Exclusion OK?

[austin3515]

Can I exclude Non-Shareholder Physicians who regularly work less than 40 hours per week? It's not an exclusion based on primarily on service so I wasn't sure if this might be an out.

[QDROphile]

I think the exclusion would get unfavorable attention if not outright challenge unless you can find a way to detach the hours feature of the standard or provide eligibility if the statutory 1000 hours standard is achieved. I am assuming that this is not a government or church plan.

[Peter Gulia]

Does the employer desire to exclude all non-shareholder physicians, or only those of them who work less than 40 hours a week?

Are all of the full-time non-shareholder physicians highly-compensated employees?

Are some of the part-time non-shareholder physicians non-highly-compensated employees?

[austin3515]

Does the employer desire to exclude all non-shareholder physicians, or only those of them who work less than 40 hours a week?

Just those under 40

Are all of the full-time non-shareholder physicians highly-compensated employees?

Are some of the part-time non-shareholder physicians non-highly-compensated employees?

There is just one, an NHCE. Although I didn't think it mattered, unless you are suggesting that I just not give them an allocation if they were HCE's--I had thought of that too, but the plan is a 3% SHNEC). Because they are part-time they will be under 115,000 but over 1,000 hours.

[Kevin C]

I'm not following why the exclusion your client wants wouldn't be considered as an exclusion primarily based on service. Non-shareholder physicians who regularly work at least 40 hours/week would be eligible. Non-shareholder physicians who regularly work less than 40 hours/week would be excluded. The only difference between the two groups is their hours/week. To me, that sounds like employees being excluded based on service.

[Kevin C]

Are the non-shareholder physicians who normally work 40+ hours/week salaried? I'm wondering if an exclusion of hourly paid non-shareholder physicians would accomplish what the client wants?

[austin3515]

"I'm not following why the exclusion your client wants wouldn't be considered as an exclusion primarily based on service. Non-shareholder physicians who regularly work at least 40 hours/week would be eligible. Non-shareholder physicians who regularly work less than 40 hours/week would be excluded. The only difference between the two groups is their hours/week. To me, that sounds like employees being excluded based on service. "

Yes, I think that was why I asked the question in the first place. I agree, so does TAG, etc.

I like the idea of having the part-timer be hourly very very very much...

[BG5150]

How do doctors track hours?

[GMK]

^excellent point, BG.

If their pay doesn't equal an hourly rate times their recorded hours of work, it'll be hard to classify them as hourly. More likely they're paid a monthly salary for a work schedule that is less than 40 hours a week, but which salary is not based on how many hours they actually work.